Stock Market Today, March 27: Amazon Falls as AI Spending Raises Margin Pressure

The company’s trading volume reached 55.4 million shares, which is nearly 13% above compared with its three-month average of 49.1 million shares. Amazon went public in 1997 and has grown 203481% since its IPO.

How the markets moved today

The broader markets weakened Friday, with the S&P 500 (SNPINDEX:^GSPC) closing at 6,378.85, down 1.67%, while the Nasdaq Composite (NASDAQINDEX:^IXIC) finished at 20,948.36, falling 2.15%. Within e-commerce and cloud computing, industry rivals Alibaba Group (NYSE:BABA) closed at $122.69 (-2.17%) and Walmart (NASDAQ:WMT) finished at $122.89 (+0.58%), underscoring mixed peer performance.

What this means for investors

Amazon shares fell as concerns around rising AI capital spending and softer growth expectations weighed on sentiment, with same-day reports pointing to pressure from higher investment needs, macro headwinds, and regulatory uncertainty. The move suggests investors are placing greater weight on how quickly Amazon’s expanding AI efforts within AWS translate into measurable revenue and profit growth, rather than on the scale of those investments alone.

At the same time, Amazon’s plans to extend AI capabilities into physical retail and logistics indicate that spending is broadening beyond cloud. While these initiatives could support future efficiency and new revenue streams, they also raise the risk of near-term margin pressure if returns take longer to materialize. Investors will be watching whether AWS’s growth and AI-driven demand can accelerate enough to justify the current investment pace without further reducing profitability.

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Eric Trie has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Walmart. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.